The amendments
amend the Treasury Legislation
Amendment (Unclaimed Money and Other Measurers) Bill
2012 (the Bill) which was introduced to the Parliament
on 30 October 2012.

The amendments
amend the commencement dates for Schedules 1 to 4 and provide for
greater flexibility in setting the minimum unclaimed bank amount
that must be reported and transferred to the Australian Securities and
Investments Commission (ASIC). The amendments also
replace the transitional section in Schedule 1 and insert a
transitional section into Schedules 2 to 4. The revised
transitional provisions are intended to provide more time for
authorised deposit-taking institutions (ADIs), First Home
Saver Account (FHSA) providers and life insurers to implement the
changes, and provide more time for superannuation funds to transfer
lost super accounts to the Australian Taxation Office (ATO).

Date of
effect : Item 8 of Schedule 1, item 6 of
Schedule 2, item 4 of Schedule 3, and items 1 to 4, 7 and 8 of
Schedule 4 commence on the day after Royal Assent. Items 1 to
7 of Schedule 1, items 1 to 5 of Schedule 2, and items 1 to 3 of
Schedule 3 commence on 1 July 2013. Items 5 and 6 of Schedule
4 commence on 30 December 2012.

Proposal
announced : The measures were
announced in the 2012-13 Mid-Year Economic and
Fiscal Outlook .

Financial
impact : The amendments have no financial
impact.

Human rights
implications : The amendments do
not raise any human rights issues.

1.2
In section 2 of the Bill, Schedules 1 to 4 are set to commence on
the day after receiving Royal Assent. This means ADIs,
insurers and superannuation funds need to apply to the changes on
the day after Royal Assent.

1.3
The amendments amend the commencement dates:

(i) item 8 of Schedule 1, item 6 of Schedule 2,
item 4 of Schedule 3, and items 1 to 4, 7 and 8 of Schedule 4
commence on the day after Royal Assent;

(ii) items 1 to 7 of Schedule 1, items 1 to 5 of
Schedule 2, and items 1 to 3 of Schedule 3 commence on 1 July 2013;
and

(iii)
items 5 and 6 of Schedule 4 commence on
30 December 2012.

1.4 The amendments will provide
more time to ADIs, FHSAs providers, life insurers and
superannuation funds to implement the changes. This will
address the concerns raised by the banking and
superannuation industries on the tight timeframe to implement the
changes.

Item 2 — Assessment
Date

1.7
The Bill and the current Banking Act 1959 (Banking Act) do
not provide a clear assessment date for ADIs to assess unclaimed
moneys.

1.8
Subsection 69(3) of the Banking Act states that an ADI shall
deliver a statement of unclaimed moneys within three months after
the 31 December in each year, but does not specify an
assessment date for ADIs to assess unclaimed moneys as at that
date. In practice, many ADIs have interpreted this
requirement as containing an implied assessment date of
31 December but have sought clarification that this
interpretation is correct.

1.9
Item 2 will specify the assessment date, which is at end of the
year, in subsection 69(3). That means all ADIs will be
required to assess the unclaimed moneys as at end of 31 December
each year.

1.10
This amendment will provide clarity to ADIs for assessing unclaimed
moneys and consistency throughout the Bill.

1.12
Item 3 amends the minimum unclaimed money amount that is required
to be reported and transferred to ASIC from $100 or a higher
prescribed amount to be $100 or such other amount as may be
prescribed.

1.13
Under the current provision, unclaimed moneys which are not less
than $100 or a higher prescribed amount are required to be reported
and transferred. Consequently, regulations may only prescribe
an amount higher than $100. The current prescribed amount is
$500, which was set by the Banking (Unclaimed Moneys) Regulations
1993 .

1.14
There is no minimum for other types of unclaimed moneys.
Further, the current threshold means that the details of smaller
accounts are never published in accordance with
subsection 69(9) and so cannot be found by their rightful
owners via a search using the facility on the ASIC website.

1.15
Item 3 will amend subsection 69(3) to allow the threshold to be set
through regulation, either higher than $100 or lower than
$100.

ADIs are required to make a supplementary
assessment and payment by 31 May 2013 in addition to the seven year
assessment and payment currently required by 31 March
2013.

The default assessment date f or supplementary
payment is 30 May 2013. However, ADIs
could pick any date as their assessment date, between 31 December
2012 and 29 May 2013.

ADIs do not need to assess the seven-year
unclaimed amount again in the supplementary assessment as they
already did so in the original assessment. This means that
the supplementary assessment does not need to include the
seven-year unclaimed amount to avoid double
counting.

Extends the unclaimed moneys payment date from 31
March 2013 to 30 April 2013 for the three year
assessment.

1.20
The item requires ADIs to make a supplementary assessment
and transfer of accounts to ASIC. ADIs will assess unclaimed
moneys as at 31 December 2012 in line with the original
seven-year period; then in early 2013, ADIs will have a
supplementary assessment and payment in line with the revised
three-year period.

1.21
Under the new item, the default assessment day for the
supplementary statement and payment obligations will be 30 May
2013. However, it also provides flexibility to ADIs to
nominate an alternative assessment date between 31 December
2012 and 29 May 2013. This is intended to provide
flexibility for ADIs to nominate the assessment date that is most
appropriate for their particular systems. ADIs will be
required to provide the supplementary statement and payment on or
before 31 May 2013.

1.22
For the supplementary assessment, ADIs do not need to count the unclaimed
seven-year moneys so as to avoid double counting of accounts
caught by the standard statement and payment on or before
31 March 2013.

Example
1.1

XYZ bank has assessed its
unclaimed moneys as at 31 December 2012 for the original
assessment (seven-year inactive period) and will transfer the
moneys to ASIC by 31 March 2013. The bank then needs to
assess its unclaimed
moneys again for supplementary assessment, reporting
and transfer. If it does not nominate an alternative
assessment date, it should do the supplementary assessment based on
the three-year definition of unclaimed moneys as at
30 May 2013. It must then provide a supplementary
statement and payment on or before
31 May 2013

Example
1.2

If the bank nominates 31
December 2012 as its assessment date, it must still complete its
reporting and payment obligations based on the seven-year
definition by 31 March 2013. However, it may use
31 December 2012 as the date at which to assess unclaimed
moneys using the three-year definition for the supplementary
statement and payment that is due by 31 May 2013. It is
not required to double count accounts in the two statements and
payments.

Example
1.3

The XYZ bank could make a
single payment to support the two statements instead of making a
separate supplementary payment. The bank has to nominate 31
December 2012 as its assessment date for supplementary
payment and assess the moneys in line with the three-year
period which includes the seven-year unclaimed moneys and
transfer the moneys to ASIC by 31 March 2013.

FHSAs providers are required to make a
supplementary assessment and payment by 31 May 2013 in addition to
the seven year assessment and payment currently required by
31 March 2013.

The default assessment date is 30 May 2013for
the supplementary payment. However, providers could pick any
date as their assessment date, between 31 December 2012 and 29 May
2013.

Providers do not need to assess the
seven-year unclaimed amount again in the supplementary
assessment as they already did so in the original assessment.
This means that the supplementary assessment does not need to
include the seven-year unclaimed amount to avoid double
counting.

1.26
The item requires FHSAs providers to make a supplementary
assessment and payment. Providers will assess unclaimed
moneys as at 31 December 2012 in line with the original
seven-year period; then in early 2013, providers will have a
supplementary assessment and payment in line with the revised
three-year period.

1.27
Under the item, providers are allowed to choose an assessment date
for the supplementary assessment and payment; however, they must
supply the supplementary statement and make the supplementary
payment by 31 May 2013.

1.28
For the supplementary assessment, providers should not count the
unclaimed seven-year moneys so as to avoid double
counting.

Example
1.4

Please refer to Example 1.1
to 1.3. Similar scenarios apply to FHSA providers.

Life insurers are required to make a supplementary
assessment and payment by 31 May 2013 in addition to the seven year
assessment and payment currently required by 31 March
2013.

The default assessment date is 30 May 2013
for the supplementary payment. However, life insurers could
pick any date as their assessment date, between 31 December
2012 and 29 May 2013.

Life insurers do not need to assess the
seven-year unclaimed amount again in the supplementary
assessment as they already did so in the original assessment.
This means that the supplementary assessment does not need to
include the seven-year unclaimed amount to avoid double
counting.

1.32
The item requires life insurers to make a supplementary assessment
and payment. Insurers will assess unclaimed moneys as at
31 December 2012 in line with the original seven-year
period; then in early 2013, insurers will have a supplementary
assessment and payment in line with the revised three-year
period.

1.33
Under the item, insurers are allowed to choose an assessment date
for the supplementary assessment and payment; however, they must
make the supplementary payment by 31 May 2013.

1.34
For the supplementary assessment, insurers should not double count
the unclaimed seven-year moneys.

Example
1.5

Please refer to Example 1.1
to 1.3. The similar scenarios apply to life
insurers.

1.2
Superannuation providers are required to pay certain lost member
accounts as at the end of an unclaimed money day to the
Commissioner of Taxation (Commissioner) by the end of the scheduled
statement day. The account holder must still be a lost member
immediately before the payment is made.

1.3
The Commissioner may specify dates for unclaimed money statements
and payment, by legislative instrument under section 15A of the
SUMLM Act.

1.4
The current instrument specifies that for the 31 December unclaimed
money day the scheduled statement day is 30 April of the following
year.

1.5
Under the new arrangements in the Treasury Legislation Amendment (Unclaimed Money
and Other Measures Bill) 2012 small lost accounts with
balances of less than $2,000 and accounts of unidentifiable members
that have been inactive for 12 months will be required to be paid
to the Commissioner. These arrangements will apply from the
31 December 2012 unclaimed money day.

1.6
The item extends the date the payment is due for certain lost
member accounts, for the 31 December 2012 unclaimed money day from
the 30 April 2013 to 31 May 2013. This will provide more time
for superannuation providers to implement the new arrangements for
lost member accounts, including additional time to locate lost
members.